In today’s briefing:
- 7&I (3382) – MBO Off, SC “Engaging Constructively with ACT”, Skepticism Higher, Questions And More
- Sun Art Retail (6808 HK): BABA Takes Massive Hit After Inking SPA @ HK$1.38
- Japan Post Bank (7182 JP): Another BIG Offering of US$4bn Expected; Overhang Will Be Removed
- Japan Post Bank (7182) – Missed Opportunity Leaves Likely Shadow Overhang
- Korea FSS Shakes Up Rights Offerings – Special Review Rule Now Live
- HK CEO & Director Dealings (28th Feb 2025): Mobvista, Xtep, Onewo, Bonny International
- JX Advanced Metals (5016 JP): IPO Fast-Entry 30% Away; Index Review Inclusion in Aug & Sep 2025
- Tencent (700 HK): Expiry-Day Recap; Intra-Day Swing of 4.1%.
- Street Intel on NPS’s Buy Flow—the Key Swing Factor as Korea’s Short-Selling Comeback
- Shareholder Benefits to Return Amid Rise in Foreign Ownership and Dissolution of Cross-Shareholdings
7&I (3382) – MBO Off, SC “Engaging Constructively with ACT”, Skepticism Higher, Questions And More
- The MBO is off. Itochu Corp (8001 JP) has apparently not been able to agree with Ito-san on board composition/representation and management control. That the MBO is off isn’t surprising.
- 7&i says they “continue to engage constructively with ACT and alternate proposals but news articles suggest that almost 6mos after proposing an NDA, ACT still haven’t had access to financials.
- The shares are off hard today to a level below where ACT’s first bid was considered “not even worth discussing”. There will be questions at the AGM and before.
Sun Art Retail (6808 HK): BABA Takes Massive Hit After Inking SPA @ HK$1.38
- HK$1.38/Share. That’s the takeaway as Alibaba Group (9988 HK) enters an SPA to offload its 78.7% stake in Sun Art (6808 HK) at HK$1.38/share, a 44.4% discount to last close.
- The buyer, Paragon Shine, an entity under Chinese PE outfit DCP Capital, is paying ~HK$12.3bn compared to BABA’s HK$28.1bn purchase of a 51% stake in October 2020.
- Should the SPA complete, an unconditional MGO is triggered. Minorities tendering can receive up to HK$1.58/share. But the question is: why would BABA be cashing out at this price?
Japan Post Bank (7182 JP): Another BIG Offering of US$4bn Expected; Overhang Will Be Removed
- Media reports indicate that Japan Post Holdings (6178 JP) could sell JPY 600bn (US$4.02bn) of Japan Post Bank (7182 JP) with the announcement coming as early as this week.
- The selldown is driven by Japan Post Holdings (6178 JP) needing to reduce its holding in Japan Post Bank (7182 JP) to 50% or lower by March 2026.
- Passive index trackers will buy around 11.4% of the offering at the time of settlement of the placement shares with the balance being bought in January 2026.
Japan Post Bank (7182) – Missed Opportunity Leaves Likely Shadow Overhang
- The Offering comes in lighter than expected. The buyback is smaller than expected. The resultant overhang is larger than expected.
- The index flows around the delivery date are well-understood. They are what they are.
- Shareholder structure is such that this is not quite a new IPO but needs a lot of new shareholders. BUT… there is one redeeming feature one should not ignore.
Korea FSS Shakes Up Rights Offerings – Special Review Rule Now Live
- With this new rule, the FSS is flagging shaky rights offerings early, signaling a likely correction request—and often, the first step toward the deal getting axed.
- Spot the red flags early and use the window before the FSS drops the hammer to position for a reversal play.
- The FSS’s early notice makes a reversal likely as traders bet on the deal getting nuked after the initial disclosure drop.
HK CEO & Director Dealings (28th Feb 2025): Mobvista, Xtep, Onewo, Bonny International
- The data in this insight is collated from the “shareholding disclosure” link on the HKEx website.
- Often there is a corresponding HKEx announcement on the increase – or decrease – in the shareholding by directors. Or pledging. However, such disclosures are by no means an absolute.
- The key stocks mentioned in this regular series include: Mobvista (1860 HK), Xtep International (1368 HK), Onewo (2602 HK), and Bonny International Holding (1906 HK).
JX Advanced Metals (5016 JP): IPO Fast-Entry 30% Away; Index Review Inclusion in Aug & Sep 2025
- JX Advanced Metals (5016 JP) is scheduled to be listed on 19 March 2025, at the prime market of the Tokyo Stock Exchange at an expected valuation of ~$5.3bn.
- Fast-Entry inclusion for the one global index can take place on 25 March if the stock price surges by ~30% or more on the first trading day.
- Review inclusion given failed fast-entries for both global indices, is expected in August and September 2025.
Tencent (700 HK): Expiry-Day Recap; Intra-Day Swing of 4.1%.
- During yesterday’s Option expiration day, Tencent (700 HK) experienced an intra-day swing of 4.1%.
- Trading in the afternoon oscillated around the prominent 500 strike level. Around 66% of calls and 2% of puts expired in the money.
- Volume was lower than in the preceding days; a total of 38 million shares were traded, with the morning session accounting for 53% of the volume.
Street Intel on NPS’s Buy Flow—the Key Swing Factor as Korea’s Short-Selling Comeback
- NPS’s aggressive net buying over the past four months? Just a 3% buffer rebalance—not some structural bullish call on K-stocks.
- Street intel points to NPS capping buys in the low-14% range, 1%p below target, only defending against dips. With short selling back on from March 31, further buying looks unlikely.
- With NPS stepping back and retail still weak, no real size remains on the buy side. Short flow could hit harder than expected—time to price it in and adjust positioning.
Shareholder Benefits to Return Amid Rise in Foreign Ownership and Dissolution of Cross-Shareholdings
- Most shareholder benefits items can be used in Japan. There’s history of more companies abolishing shareholder benefits programs because they believed that shareholder returns should conducted rather than shareholder benefits.
- Amid rising foreign ownership and the dissolution of cross-shareholdings, more companies have begun to reverse the trend toward companies approaching individual shareholders with shareholder benefits programs.
- The fact that stock prices of companies offering shareholder benefits tended to fall lower during stock market plunges may be due to the fact that they were mostly defensive stocks.
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